Feeds:
Posts
Comments

Posts Tagged ‘Davos’

Davos: Two Worlds, Ready or Not

Huffington Post
Simon Johnson
MIT Professor and co-author of 13 Bankers

Posted: January 29, 2011 09:50 AM

On the fringes of the World Economic Forum meeting in Davos this week, there was plenty of substantive discussion — including about the dangers posed by our “too big to fail”/”too big to save” banks, the consequences of widening inequality (reinforced by persistent unemployment in some countries), and why the jobs picture in the U.S. looks so bad.

But in the core keynote events and more generally around any kind of CEO-related interaction, such themes completely failed to resonate. There is, of course, variation in views across CEOs and the people work intellectual agendas on their behalf, but still the mood among this group was uniformly positive — it was hard to detect any note of serious concern.

Many of the people who control the world’s largest corporations are quite comfortable with the status quo post-financial crisis. This makes sense for them — and poses a major problem for the rest of us.The thinking here is fairly obvious. The CEOs who provide the bedrock of financial support for Davos have mostly done well in the past few years. For the nonfinancial sector, there was a major scare in 2008-09; the disruption of credit was a big shock and dire consequences were feared. And for leaders of the financial sector this was more than an awkward moment — they stood accused, including by fellow CEOs at Davos in previous years, of incompetence, greed, and excessively capturing the state.

But all of this, from a CEO perspective, is now behind them. Profits are good — this is the best bounce back on average in the post-war period; given that so many small companies are struggling, it is reasonable to infer that the big companies have done disproportionately well (perhaps because their smaller would-be competitors are still having more trouble accessing credit). Executive compensation at the largest firms will no doubt reflect this in the months and years ahead.

In terms of public policy, the big players in the financial sector have prevailed — no responsible European, for example, can imagine a major bank being allowed to fail (in the sense of defaulting on any debt). And this government support for banks has translated into easier credit conditions for the major global corporations represented at Davos.

MORE HERE

Read Full Post »

Chase CEO says ‘stupid things were done by American banks,’ as bankers lose Davos clout

Raw Story- Jeremy Gantz
Published: Saturday January 31, 2009

JPMorgan Chase & Co. CEO Jamie Dimon is telling a world grappling with the biggest financial crisis since the Great Depression what it wants to hear:

“I take full blame for all the American banks and all the things they did,” Dimon said during a panel on leadership at the World Economic Forum in Davos, Switzerland Thursday.

Dimon, whose company received $25 billion from last October’s federal “bailout” legislation, said he knows that’s what people would like to hear, Bloomberg reported. “God knows, some really stupid things were done by American banks,” Dimon said Thursday.

But the 52-year-old banker, who oversaw his company’s acquisition of failing U.S. banks Washington Mutual and Bear Sterns last year, also wondered where Washington’s policy makers were while U.S. banks were laying groundwork for the ongoing meltdown.

“Where were they? They approved all these banks,” Dimon said.

Dimon was the only head of a major U.S. financial institution to attend the annual conference this year, according to Bloomberg. That’s a break from Davos tradition: in the past, the world’s elite business leaders dispensed economic wisdom while political leaders often remained in the background.

“The number of VIP politicians is huge, and it’s a lot less bankers this year,” said Rainer Ohler, senior vice president of Airbus SA. “What you are missing really is the top shots in banking.”

Heads of state, now doing their best to hold the world economy together, have taken center stage at Davos. Russia’s Prime Minister Vladimir Putin, Chinese Premier Wen Jiabao, British Prime Minister Gordon Brown, German Chancellor Angela Merkel and Mexican President Felipe Calderon are a few of the more than 40 heads of state in Davos this year, the Associated Press reported.

MORE HERE

Read Full Post »

%d bloggers like this: